Pfizer to Trim Fired Workers’ Benefits to Reduce Costs

April 5 (Bloomberg) -- Pfizer Inc., the drugmaker that’s
fired 26,000 workers in three years, is cutting its employee
severance package after May 14, according to an internal memo.

The world’s biggest pharmaceutical company has been focused
on trimming costs since it acquired Wyeth in January 2009. This
year, Pfizer is wrestling with sales losses after its biggest
product, the cholesterol drug Lipitor with $9.6 billion in 2011
sales, began facing generic competition for the first time.

Chief Executive Officer Ian Read, who took over in December
2010, has pledged to cut $1 billion from operations in 2012. The
memo says basic severance pay will be lowered to eight weeks
from 12 for U.S. workers, and that health benefits will last
eight weeks rather than a year. Employees get additional weeks
of pay and health insurance the longer they’ve been with the
company. The memo was supplied to Bloomberg by a Pfizer
employee, and confirmed by Joan Campion, a spokeswoman.

“Our benefits continue to be competitive when compared
against those offered by our industry peers and other leading
global companies,” the memo said. “We will continue to analyze
all of our benefit programs to support our long-term
competitiveness and the sustainability of benefits in today’s
challenging business environment.”

Pfizer, based in New York, trimmed 20 percent of the
combined workforce after acquiring Wyeth, Chief Financial
Officer Frank D’Amelio said in an interview in January. In 2011,
Pfizer cut $642 million, or 5 percent, from expenses, the
company has said.

Other parts of the drugmaker’s employee severance package,
including a 60-day notice and a $5,000 retraining program, will
remain in place, according to the memo.

Pfizer shares fell less than 1 percent to $22.34 at the
close of New York trading.